United States v. Bazaarvoice Inc.; Proposed Final Judgment and Competitive Impact Statement, 28949-28965 [2014-11577]

Agencies

• Antitrust Division
• Department of Justice

[Federal Register Volume 79, Number 97 (Tuesday, May 20, 2014)]
[Notices]
[Pages 28949-28965]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-11577]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Bazaarvoice Inc.; Proposed Final Judgment and 
Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, 
Stipulation and Competitive Impact Statement have been filed with the 
United States District Court for the Northern District of California in 
United States of America v. Bazaarvoice, Inc., Civil Action No. 13-
00133. On January 8, 2014, the Court held that Bazaarvoice, Inc.'s June 
2012 acquisition of PowerReviews, Inc. violated Section 7 of the 
Clayton Act, 15 U.S.C. 18. The proposed Final Judgment requires 
Bazaarvoice to divest the assets it acquired from PowerReviews and 
adhere to other requirements to fully restore competition in the 
provision of online product ratings and reviews platforms.
    Copies of the Complaint, Stipulation, proposed Final Judgment and 
Competitive Impact Statement are available for inspection at the 
Department of Justice, Antitrust Division, Antitrust Documents Group, 
450 Fifth Street NW., Suite 1010, Washington, DC 20530 (telephone: 202-
514-2481), on the Department of Justice's Web site at https://www.usdoj.gov/atr, and at the Office of the Clerk of the United States 
District Court for the Northern District of California. Copies of these 
materials may be obtained from the Antitrust Division upon request and 
payment of the copying fee set by Department of Justice regulations.
    Public comment is invited within 60 days of the date of this 
notice. Such comments, including the name of the submitter, and 
responses thereto, will be posted on the U.S. Department of Justice, 
Antitrust Division's internet Web site, filed with the Court and, under 
certain circumstances, published in the Federal Register. Comments 
should be directed to James J. Tierney, Chief, Networks and Technology 
Enforcement Section, Antitrust

[[Page 28950]]

Division, Department of Justice, Washington, DC 20530, (telephone: 202-
307-6200).

Patricia A. Brink,
Director of Civil Enforcement.
Michael D. Bonanno, Attorney (DC Bar No. 998208)
Soyoung Choe, Attorney (MD Bar, No Numbers Assigned)
Aaron Comenetz, Attorney (DC Bar No. 479572)
Peter K. Huston, Attorney (CA Bar No. 150058)
Ihan Kim, Attorney (NY Bar, No Numbers Assigned)
Claude F. Scott, Jr., Attorney (DC Bar No. 414906)
Adam T. Severt, Attorney (MD Bar, No Numbers Assigned)
United States Department of Justice, Antitrust Division
450 Fifth Street NW., Suite 7100
Washington, DC 20530
Telephone: (202) 532-4791
Facsimile: (202) 616-8544
Email: michael.bonanno@usdoj.gov

[Additional counsel listed on signature page]

Attorneys for Plaintiff United States of America

UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

UNITED STATES OF AMERICA, Plaintiff,
v.
BAZAARVOICE, INC. Defendant.
Case No. 13-cv-00133 WHO

COMPLAINT

    The United States of America, acting under the direction of the 
Attorney General of the United States, brings this civil action to 
obtain equitable relief remedying the June 2012 acquisition of 
PowerReviews, Inc. (``PowerReviews'') by Defendant Bazaarvoice, Inc. 
(``Bazaarvoice''). The United States alleges as follows:

INTRODUCTION

    1. Many retailers and manufacturers purchase product ratings and 
reviews platforms (``PRR platforms'') to collect and display consumer-
generated product ratings and reviews online. Bazaarvoice provides the 
market-leading PRR platform, and PowerReviews was its closest 
competitor. No other PRR platform competitor has a significant number 
of PRR platform customers in the United States. By acquiring 
PowerReviews, Bazaarvoice eliminated its most significant rival and 
effectively insulated itself from meaningful competition.
    2. The acquisition of PowerReviews was a calculated move by 
Bazaarvoice that was intended to eliminate competition. Bazaarvoice's 
senior executives spent more than a year considering whether buying 
PowerReviews would reduce pricing pressure and diminish competition in 
the marketplace. As a result of their extensive deliberations, the 
company's business documents are saturated with evidence that 
Bazaarvoice believed the acquisition of PowerReviews would eliminate 
its most significant competitive threat and stem price competition.
    3. In April 2011, Brant Barton, one of Bazaarvoice's co-founders, 
outlined the benefits of the acquisition in an email to senior 
Bazaarvoice executives. He noted that acquiring PowerReviews would 
``[e]liminat[e] [Bazaarvoice's] primary competitor'' and provide 
``relief from [] price erosion.'' He also discussed the absence of 
competitive alternatives for customers, concluding that Bazaarvoice 
would ``retain an extremely high percentage of [PowerReviews] 
customers,'' because available alternatives for disgruntled customers 
were ``scarce'' and ``low-quality.''
    4. On May 4, 2011, Brett Hurt, Bazaarvoice's Chief Executive 
Officer, supported Barton's analysis and advocated the company's 
pursuit of PowerReviews in an email to the Bazaarvoice board of 
directors. According to Hurt, the acquisition of PowerReviews was an 
opportunity to ``tak[e] out [Bazaarvoice's] only competitor, who . . . 
suppress[ed] [Bazaarvoice] price points []by as much as 15% . . . .''
    5. Two days later, Barton, Hurt, and Stephen Collins, Bazaarvoice's 
Chief Financial Officer, met with senior PowerReviews executives to 
discuss the potential acquisition. In his notes from the meeting, 
Barton wrote that the transaction would enable the combined company to 
``avoid margin erosion'' caused by ``tactical `knife-fighting' over 
competitive deals.'' He later prepared a presentation for Bazaarvoice's 
board of directors in which he claimed the transaction would 
``[e]liminate [Bazaarvoice's] primary competitor'' and ``reduc[e] 
comparative pricing pressure.''
    6. In October 2011, Collins emailed other senior Bazaarvoice 
executives to provide his perspective regarding the potential 
acquisition. He recommended that Bazaarvoice continue its pursuit of 
PowerReviews because he feared price competition with PowerReviews 
would impair the long-term value of Bazaarvoice's business. Collins 
believed that Bazaarvoice had ``literally, no other competitors,'' and 
he expected ``pricing accretion'' from the combination of the two 
firms. In November 2012, Stephen Collins replaced Brett Hurt as 
Bazaarvoice's Chief Executive Officer.
    7. In November 2011, Hurt sought permission from Bazaarvoice board 
members to continue exploring a potential deal with PowerReviews, 
observing that Bazaarvoice would have ``[n]o meaningful direct 
competitor'' after acquiring PowerReviews, thereby reducing ``pricing 
dilution.''
    8. In December 2011, Collins and Barton met with PowerReviews 
representatives again. Following the meeting, Collins prepared a 
memorandum for Bazaarvoice's board of directors to outline the expected 
benefits of the acquisition. He wrote that the acquisition of 
PowerReviews would (1) ``eliminat[e] feature driven one-upmanship and 
tactical competition;'' (2) ``[c]reate[] significant competitive 
barriers to entry;'' (3) ``eliminate the cost in time and money to take 
[PowerReviews'] accounts;'' and (4) ``reduce [Bazaarvoice's] risk of 
account losses as [PowerReviews] compete[d] for survival.''
    9. In May 2012, Bazaarvoice executives completed their due 
diligence for the acquisition. To support their recommendation to 
proceed with the acquisition of PowerReviews, they prepared a 73-page 
memorandum for the company's board of directors. In this memorandum, 
the executives touted the transaction's dampening effect on 
competition, concluding the acquisition would ``block[] entry by 
competitors'' and ``ensure [Bazaarvoice's] retail business [was] 
protected from direct competition and premature price erosion.''
    10. Bazaarvoice's acquisition of PowerReviews closed on June 12, 
2012. The purchase price, including cash and non-cash consideration, 
was approximately $168.2 million.

THE DEFENDANT AND THE TRANSACTION

    11. Bazaarvoice is a publicly traded Delaware corporation and is 
headquartered in Austin, Texas. During its 2012 fiscal year, 
Bazaarvoice earned approximately $106.1 million in revenue.
    12. PowerReviews was a privately held Delaware corporation. Before 
the transaction, PowerReviews was headquartered in San Francisco, 
California. During the 2011 calendar year, the company earned 
approximately $11.5 million in revenue.

[[Page 28951]]

JURISDICTION

    13. The United States brings this action under Section 15 of the 
Clayton Act, 15 U.S.C. Sec.  25, to restrain Bazaarvoice's violation of 
Section 7 of the Clayton Act, 15 U.S.C. Sec.  18.
    14. This Court has subject matter jurisdiction over this action 
under Section 15 of the Clayton Act, 15 U.S.C. Sec. Sec.  4 and 25, and 
28 U.S.C. Sec. Sec.  1345 and 1331. This Court also has subject matter 
jurisdiction under 28 U.S.C. Sec.  1337, as Bazaarvoice is engaged in a 
regular, continuous, and substantial flow of interstate commerce and 
activities substantially affecting interstate commerce. Bazaarvoice 
sells PRR platforms throughout the United States.
    15. This Court has personal jurisdiction over the Defendant. 
Bazaarvoice transacts business and is found within the Northern 
District of California.

VENUE

    16. Venue is proper under Section 12 of the Clayton Act, 15 U.S.C. 
Sec.  22, and 28 U.S.C. Sec.  1391(b) and (c).

INTRADISTRICT ASSIGNMENT

    17. Assignment to the San Francisco Division is proper because this 
action arose in San Francisco County. A substantial part of the events 
that gave rise to the claim occurred in San Francisco, and 
PowerReviews' headquarters and principal place of business was located 
in San Francisco before the transaction. Bazaarvoice continues to use 
PowerReviews' former headquarters as its San Francisco office.

PRR PLATFORMS

    18. PRR platforms enable manufacturers and retailers to collect, 
organize, and display consumer-generated product ratings and reviews 
online. Consumer-generated product ratings and reviews (``ratings and 
reviews'') represent feedback from consumers regarding their 
experiences with a product. These submissions are displayed on a 
retailer's or manufacturer's Web site, allowing other consumers to read 
feedback from previous buyers before making a purchasing decision. PRR 
platforms can range from simple software solutions a company has 
developed with internal resources to sophisticated commercial platforms 
offering a combination of software, moderation services, and data 
analytics tools.
    19. Ratings and reviews are a popular feature for retailers and 
manufacturers to display on their Web sites. Ratings and reviews can 
provide highly relevant, product-specific information on a retailer's 
or manufacturer's Web site near the time of purchase. The additional 
information provided by ratings and reviews can increase sales, 
decrease product returns, and attract more consumers to a retailer's or 
manufacturer's Web site. Ratings and reviews also can provide valuable 
data about consumer preferences and behavior, which retailers and 
manufacturers can use to make inventory purchasing or product design 
decisions.
    20. Ratings and reviews may also benefit a retailer or manufacturer 
by boosting a product's ranking on a search engine results page. 
Internet search engine algorithms generally assign higher rankings to 
Web sites with fresh and unique content. Ratings and reviews are 
frequently updated, and this content is highly tailored to the 
retailer's or manufacturer's product catalog. Accordingly, when ratings 
and reviews are indexed by a search engine, the underlying product 
pages will likely receive a higher ranking on a search engine results 
page.
    21. From a consumer's perspective, ratings and reviews are useful 
because they can provide authentic information regarding another 
consumer's experience with a particular product. Feedback from other 
consumers can help a prospective buyer make a more informed purchasing 
decision. Product ratings and reviews often provide information that is 
not easily ascertainable when shopping online (e.g., quality of 
construction, fit, durability).
    22. The software component of a PRR platform provides the user 
interface and review form for the collection and display of ratings and 
reviews. Most review forms prompt consumers to rate a product on a 
five-star scale and offer consumers an option to write an open-ended 
comment about their experience with the product. Other forms also allow 
consumers to rate products along several dimensions (e.g., product 
appearance, ease of assembly, value).
    23. In addition to the technology components of their respective 
platforms, some PRR platform providers also provide moderation 
services. After a consumer submits a review, the PRR platform provider 
applies software algorithms to scan the submission for inappropriate or 
fraudulent content. After the automated scan, a human moderator 
examines each submission to ensure it complies with a particular 
client's moderation standards. These moderation standards may vary 
between clients. For example, some clients may prefer not to display 
references to their competitors on their Web sites.
    24. After moderation, the PRR platform publishes approved 
submissions in a display interface on a client's Web site. Many PRR 
platforms display a summary of a product's rating and review 
information and allow consumers to view individual reviews for more 
detailed information. The review summary may display the number of 
reviews, the product's average overall rating, a review distribution 
histogram, or information related to particular product attributes. The 
display interface may also allow consumers to filter reviews according 
to their interests.
    25. Sophisticated PRR platforms allow manufacturers to share, or 
``syndicate,'' ratings and reviews with their retail partners. Through 
the syndication network, retailers can display reviews that were 
originally collected by a product's manufacturer. Syndication helps 
retailers obtain more content than they could independently. 
Manufacturers and retailers both benefit from the ability to display 
more reviews at the point of sale. Syndication between a manufacturer 
and a retailer using different PRR platforms is possible, but requires 
expensive, customized integration work to connect the platforms.
    26. Some PRR platforms also include analytics software that 
manufacturers and retailers use to analyze information collected from 
ratings and reviews. With these tools, manufacturers and retailers can 
track and analyze real-time consumer sentiment. Manufacturers and 
retailers can use this information to identify product design defects, 
make product design decisions, or identify consumers for targeted 
marketing efforts.
    27. PRR platforms are sold by Bazaarvoice and other commercial 
suppliers in direct sales processes that require a significant amount 
of time and negotiation. Prices are individually negotiated, and each 
customer's price is independent of the prices that other customers 
receive. Arbitrage, or indirect purchasing from other customers, is not 
possible because customers cannot re-sell PRR platforms that they have 
purchased from a commercial supplier. Accordingly, customers commonly 
receive different prices, even when purchasing similar products and 
services.
    28. PRR platform providers negotiate prices in light of each 
customer's demand characteristics, taking into account competitive 
alternatives. Bazaarvoice calls this method of setting prices ``value-
based'' pricing, meaning ``the more value the [client] perceives, the 
higher [Bazaarvoice's] price point.''

[[Page 28952]]

During the sales process, it is typical for a salesperson to ask the 
prospective customer to divulge detailed information related to its 
business, which may include information related to (1) annual volume of 
online sales; (2) product return rates; (3) historic conversion rates; 
(4) e-commerce vendor relationships; or (5) project budgets. This 
process enables the PRR platform provider to assess the prospect's 
willingness to pay for a PRR platform. After acquiring as much 
information as possible about the prospect, the PRR platform provider 
offers a price that aligns closely with its perception of the 
prospect's willingness to pay for its product.
    29. Throughout the course of the sales process, a salesperson will 
also ask whether a prospective customer is considering other 
competitive alternatives. In most cases, the presence of competition is 
relatively transparent. Prospects routinely reveal the identity of 
competitors during negotiations and may even reveal the terms of 
competitive offers to improve their bargaining position. Accordingly, 
suppliers adjust their pricing to account for other competitive offers, 
depending on the nature of the threat posed by the competition.

RELEVANT MARKET

    30. PRR platforms used by retailers and manufacturers are a 
relevant product market and ``line of commerce'' within the meaning of 
Section 7 of the Clayton Act.
    31. The United States is a relevant geographic market. PowerReviews 
was routinely the only significant competitive threat that Bazaarvoice 
faced in U.S.-based sales opportunities. As a result of the 
transaction, Bazaarvoice will be able to profitably impose targeted 
price increases on retailers and manufacturers based in the United 
States.

ELIMINATION OF HEAD-TO-HEAD COMPETITION BETWEEN BAZAARVOICE AND 
POWERREVIEWS WILL HARM RETAILERS AND MANUFACTURERS

A. Bazaarvoice's acquisition of PowerReviews eliminated the company's 
closest competitor and is likely to substantially lessen competition.

    32. Before the acquisition, Bazaarvoice was the leading commercial 
supplier of PRR platforms, and PowerReviews was its closest competitor 
by a wide margin. Bazaarvoice's former CEO acknowledged that 
``PowerReviews is [Bazaarvoice's] biggest competitor,'' and the 
company's decision to acquire PowerReviews was bolstered by its current 
CEO's belief that there are ``literally, no other competitors'' in the 
market. Through the removal of its most significant rival, Bazaarvoice 
acquired the ability to profitably raise the price of its platform 
above pre-merger levels. In fact, Bazaarvoice's current CEO pressed for 
the company to acquire PowerReviews because he anticipated ``pricing 
accretion'' due to the consolidation of the two firms.
    33. Prospective customers routinely played Bazaarvoice and 
PowerReviews against each other during negotiations. Consequently, a 
Bazaarvoice ``playbook'' for competing with PowerReviews mandated that 
``[p]ricing only [be] delivered when [the customer's] BATNA and ZOPA 
have been clearly identified.'' BATNA and ZOPA are acronyms which stand 
for ``best alternative to negotiated agreement'' and ``zone of possible 
agreement.'' For many manufacturers and retailers, PowerReviews was the 
best alternative to a negotiated agreement with Bazaarvoice. 
Accordingly, competitive pressure from PowerReviews frequently forced 
Bazaarvoice to offer substantial price discounts.
    34. Other commercial suppliers of PRR platforms are not 
sufficiently close substitutes to Bazaarvoice's platform to prevent a 
significant post-merger price increase. PowerReviews was the most 
substantial restraint on Bazaarvoice's conduct in the United States 
before the merger, and no other competitor was a comparable rival. 
Bazaarvoice now faces virtually the same competitive landscape of 
``scarce'' and ``low quality'' alternatives that Brant Barton 
identified in April 2011.
    35. The absence of other meaningful competitors also has been 
recognized by both industry analysts and PowerReviews' former CEO, Pehr 
Luedtke, in calling the PRR platform market a ``duopoly.'' Erin 
Defoss[eacute], Bazaarvoice's Vice President of Strategy, has agreed 
that ``[t]here really isn't a market . . . to understand (as it relates 
[to ratings and reviews]), it is [Bazaarvoice] or PowerReviews.'' 
Additionally, PowerReviews' CEO, Ken Com[eacute]e, and PowerReviews' 
Chief Financial Officer, Keith Adams, acknowledged that the combination 
of Bazaarvoice and PowerReviews would create a ``[m]onopoly in the 
market'' when evaluating the anticipated benefits of the acquisition.
    36. The commanding position occupied by Bazaarvoice and 
PowerReviews is also readily apparent from their combined market share 
in the Internet Retailer 500 (``IR 500''), which is an annual ranking 
of the 500 largest internet retailers in North America according to 
online sales revenue. Bazaarvoice regularly tracks its IR 500 market 
position, and company executives considered the impact that the 
acquisition of PowerReviews would have on Bazaarvoice's IR 500 market 
share. For example, in the diligence memorandum prepared for the 
company's board of directors, Bazaarvoice executives wrote, 
``[PowerReviews'] customer base includes 86 IR 500 retailers who have 
resisted becoming Bazaarvoice customers despite significant attempts to 
displace [PowerReviews] from these accounts'' and noted that the 
acquisition of PowerReviews would ``immediately increase the IR 500 
penetration of Bazaarvoice by 49%.'' Within the IR 500, more than 350 
retailers collect and display ratings and reviews. Approximately 70% of 
these firms use a PRR platform provided by Bazaarvoice or PowerReviews. 
Most of the remaining Web sites use in-house PRR solutions.
    37. In addition to purchasing a PRR platform from a commercial 
supplier, a retailer or manufacturer seeking to include ratings and 
reviews on its Web site may elect to develop an in-house PRR solution. 
For many retailers and manufacturers, however, it is impractical and 
cost-prohibitive to build an internal solution that can satisfy their 
business requirements. Accordingly, the acquisition particularly harms 
retailers and manufacturers for which an in-house solution is not an 
economically viable alternative.
    38. For many retailers and manufacturers, in-house PRR solutions 
are not sufficiently close substitutes to Bazaarvoice's platform to 
impede a post-merger price increase by Bazaarvoice. It would be 
prohibitively expensive for many customers to develop a PRR solution 
with functionality comparable to the features offered by Bazaarvoice, 
and it would be difficult to maintain the same pace of innovation. 
Moreover, it would be very complex and expensive for a customer to 
perform the same level of moderation. In-house solutions are only a 
viable option for customers that are not interested in the full feature 
set offered by Bazaarvoice (including moderation and syndication 
services), or customers that are willing to invest heavily in ongoing 
platform development to maintain the software and create new features.
    39. Bazaarvoice is able to use information obtained during the 
sales process to determine whether an in-house PRR solution is an 
economically viable alternative for a particular

[[Page 28953]]

customer. Accordingly, in light of the merger, it will be a profit-
maximizing strategy for Bazaarvoice to impose targeted price increases 
on customers that do not consider in-house solutions to be a viable 
alternative. Faced with an anticompetitive post-merger price increase, 
these customers would not develop an in-house solution or abandon 
ratings and reviews altogether.
    40. Other social commerce products, including community platforms, 
forums, and question and answer (``Q&A'') platforms, are also not 
substitutes for PRR platforms. These other social commerce products do 
not collect the same type of structured, product-level data associated 
with ratings and reviews. Because PRR platforms and other social 
commerce products serve different purposes, retailers and manufacturers 
routinely use PRR platforms in combination with one or more other 
social commerce products.
    41. As a result of Bazaarvoice's acquisition of PowerReviews, 
customers will lose critical negotiating leverage. The elimination of 
PowerReviews has significantly enhanced Bazaarvoice's ability and 
incentive to obtain more favorable contract terms. Accordingly, many 
retailers and manufacturers will now obtain less favorable prices and 
contract terms than Bazaarvoice and PowerReviews would have offered 
separately absent the merger.

B. PowerReviews' ``scorched earth approach to pricing'' applied 
significant pressure to Bazaarvoice in competitive deals.

    42. Price competition with Bazaarvoice was a core component of 
PowerReviews' business strategy. PowerReviews positioned itself as a 
low-price alternative to Bazaarvoice and aggressively pursued 
Bazaarvoice's largest clients. The company set an internal goal to 
``[b]e in every deal [Bazaarvoice] is in,'' and encouraged price 
competition by building a ``cost structure to support price 
compression.'' As a result of price competition between Bazaarvoice and 
PowerReviews, manufacturers and retailers obtained substantial 
discounts--sometimes in excess of 60%.
    43. PowerReviews' aggressive approach to pricing frequently forced 
Bazaarvoice to defend its more expensive list prices. Responding to 
competitive pressure from PowerReviews in July 2011, Bazaarvoice's Vice 
President of Retail Sales warned, ``[PowerReviews] has been VERY active 
in almost all of our deals from small to large'' (emphasis in 
original). He claimed that PowerReviews had adopted a ``scorched earth 
approach to pricing,'' which ``force[d] all of [Bazaarvoice's] current 
prospects and customers to at least understand how and why there is 
such a [difference] in price.''
    44. If a prospective customer was unwilling to pay a premium over 
the PowerReviews price, Bazaarvoice often responded with substantial 
price discounts. Bazaarvoice frequently matched the PowerReviews price 
or offered a more favorable price than PowerReviews. Tony Capasso, a 
Vice President of Sales for Bazaarvoice, described this trend in a 2011 
email regarding an apparel manufacturer's consideration of 
PowerReviews: ``[L]ate adopters see us as the stronger brand but 
struggle to justify 2X-3X greater costs for a solution that looks 
somewhat the same. Even when we do show differences some [prospects] 
don't put enough stock in those differences to justify the price 
[difference]. We may need to battle on price in this case . . . .'' 
Bazaarvoice ultimately offered to match the price that PowerReviews had 
offered the apparel retailer, which represented a substantial discount 
from its initial proposal.
    45. Even if PowerReviews was unable to win a customer's business, 
its low prices set the bar for negotiations and compressed 
Bazaarvoice's margins. Bazaarvoice employees viewed PowerReviews as 
``an ankle-biter that cause[d] price pressure in deals,'' and 
acknowledged that many customers brought PowerReviews into negotiations 
as a ``lever to knock [Bazaarvoice] down on price.''
    46. PowerReviews also pursued Bazaarvoice's installed customer 
base. In some cases, PowerReviews convinced Bazaarvoice customers to 
switch platforms. In other cases, an offer from PowerReviews provided 
additional leverage for the customer to negotiate more favorable terms 
from Bazaarvoice. In 2011, Alan Godfrey, Bazaarvoice's General Manager 
of North American Retail, described this competitive dynamic as a 
``full frontal assault'' by PowerReviews that was ``successfully 
penetrating the [executive] ranks of [Bazaarvoice's] anchor clients and 
convincing them to evaluate alternatives, or at least, negotiate 
[Bazaarvoice] to lower price points.''
    47. PowerReviews' efforts to target existing Bazaarvoice customers 
did not go unnoticed. In July 2011, PowerReviews convinced a large 
electronics retailer to reevaluate its relationship with Bazaarvoice. 
Afterwards, Mike Svatek, Bazaarvoice's Chief Strategy Officer, 
expressed concern that Bazaarvoice was ``seeing new competitive 
pressure'' from PowerReviews through an ``aggressive blitz campaign.'' 
Svatek believed Bazaarvoice needed to ``eradicate'' PowerReviews, and 
he proposed a counterattack on the PowerReviews base. He advocated an 
``aggressive'' approach to ``unseat'' PowerReviews from three of its 
largest accounts.
    48. It was common for Bazaarvoice to pursue PowerReviews customers 
in this fashion. For example, in response to a PowerReviews campaign 
targeting Bazaarvoice's manufacturing clients, Bazaarvoice put into 
motion a plan to ``steal one or more major [PowerReviews] clients . . . 
by offering them something they can't refuse.'' This strategy was 
intended to send a signal to PowerReviews that Bazaarvoice was willing 
``to absorb some pain in return for handing [PowerReviews] major client 
losses.'' In at least two cases, Bazaarvoice offered to provide its PRR 
platform to large PowerReviews customers for free.
    49. Before the acquisition, a number of manufacturers and retailers 
switched between the Bazaarvoice and PowerReviews platforms. Many times 
these switches were spurred by aggressive offers that were intended to 
displace the incumbent PRR platform provider. As a result of the 
acquisition, however, Bazaarvoice will no longer need to ``absorb some 
pain'' to attract PowerReviews clients to the Bazaarvoice platform or 
retain customers in the face of lower prices from PowerReviews. When 
recommending the transaction to the company's board of directors, 
Bazaarvoice executives noted that the transaction would enable 
Bazaarvoice to acquire large PowerReviews customers that had ``resisted 
becoming Bazaarvoice customers despite significant attempts to displace 
[PowerReviews].'' Absent the transaction, they believed it was 
``unlikely that [Bazaarvoice could] attract these retailers to [its] 
platform in the foreseeable future nor [sic] without significant 
cost.''

C. Bazaaarvoice and PowerReviews engaged in ``feature driven one-
upmanship,'' which drove both firms to innovate and develop new PRR 
platform features.

    50. As PowerReviews and Bazaarvoice grappled to differentiate their 
product offerings, they developed new features and improved the 
functionality offered by their respective platforms. Pehr Luedtke, 
PowerReviews' former CEO, described the pattern of innovation 
competition between Bazaarvoice and PowerReviews in a 2010 email to a 
large consumer products retailer: ``[T]here are

[[Page 28954]]

a lot of similarities between Bazaar[v]oice and PowerReviews when it 
comes to features . . . we have constantly traded places in terms of 
who leads and who fast follows.'' Feature-driven competition between 
Bazaarvoice and PowerReviews hastened the pace of innovation and made 
ratings and reviews an increasingly attractive proposition for 
manufacturers and retailers.
    51. For example, PowerReviews began offering an ``in-line SEO 
solution'' in January 2009. This was the first PRR platform feature to 
allow ratings and reviews to be indexed by search engines directly from 
the product Web page, rather than a separate Web site designed for 
search engine optimization. PowerReviews positioned its SEO feature as 
a best-in-class offering and targeted the shortcomings of Bazaarvoice's 
SEO offering during sales calls. Bazaarvoice quickly responded by 
developing comparable functionality.
    52. Bazaarvoice, on the other hand, was the first company to create 
a review syndication network that connected manufacturers and 
retailers. PowerReviews responded by creating a similar review 
syndication feature for its clients. PowerReviews eventually pushed the 
envelope even further, aggressively marketing an ``open'' content 
syndication platform that facilitated syndication between manufacturers 
that were not PowerReviews clients and retailers using the PowerReviews 
platform. When PowerReviews announced its open syndication network, it 
invited all Bazaarvoice manufacturing clients to try its syndication 
service for free for twelve months.
    53. Bazaarvoice's manufacturing clients began to ask Bazaarvoice to 
syndicate their reviews to retail partners on the PowerReviews 
platform. Bazaarvoice initially resisted, in an attempt to maintain its 
``closed'' syndication platform. In communicating this approach to 
Bazaarvoice's sales leadership team, Michael Osborne, Bazaarvoice's 
Chief Revenue Officer wrote, ``[T]ell all of your teams . . . that we 
do not support syndication outside of our network--and if we get 
requests for it, escalate to the top immediately. There's a new 
competitive battle coming.'' Internally, Bazaarvoice acknowledged that 
it was ``making a strategic choice not to create a custom (and safe) 
version of [the content] feed for retailers outside of [the 
Bazaarvoice] network.''
    54. Finally, Bazaarvoice relented to customer pressure and began 
developing a new offering to syndicate content to PowerReviews' 
retailers. In an internal announcement, Erin Defoss[eacute], 
Bazaarvoice's Head of Product Strategy, acknowledged that this move was 
in response to PowerReviews' open syndication network. Brett Hurt was 
optimistic about his company's new approach, stating, ``I cannot wait 
until we turn the tables on PowerReviews with their aggressive push. 
Our strategy is going to rock them and put them on their heels.'' He 
pushed for Bazaarvoice to execute on its plan to ``destroy'' 
PowerReviews, urging ``[PowerReviews] is not waiting for us. . . . I 
want to aim a big bazooka in their direction.''

D. The anticompetitive effects of the transaction will not be 
counteracted by entry, repositioning, or merger-specific efficiencies.

    55. Entry or expansion by other firms is unlikely to alleviate the 
competitive harm caused by the transaction. Since its founding, 
Bazaarvoice has been the largest commercial provider of PRR platforms, 
and PowerReviews was its closest competitor. Other providers exist, but 
they have struggled to win customers and gain market share. 
Bazaarvoice's competitive position is protected by substantial barriers 
to entry.
    56. Bazaarvoice's syndication network is a formidable barrier to 
entry in the market for PRR platforms. As more manufacturers purchase 
Bazaarvoice's PRR platform, the Bazaarvoice network becomes more 
valuable to retailers because it will allow them to gain access to a 
greater volume of ratings and reviews. Similarly, as more retailers 
purchase Bazaarvoice's PRR platform, the Bazaarvoice network becomes 
more valuable for manufacturers because it will allow them to syndicate 
content to a greater number of retail outlets. The feedback between 
manufacturers and retailers creates a network effect that is a 
significant and durable competitive advantage for Bazaarvoice.
    57. Bazaarvoice has acknowledged the importance of its syndication 
network as a substantial barrier to entry that protects its dominant 
position. Before its initial public offering in February 2012, 
Bazaarvoice prepared a document for an investor roadshow in which it 
explained the ``powerful network economies'' created by linking 
retailers to manufacturers. Bazaarvoice claimed that it competes in a 
``winner-take-all'' market, and identified its ``ability to leverage 
the data'' from its customer base as ``a key barrier [to] entry.'' 
During investor roadshows, the company boasted, ``[A]ny company 
entering the market would have to start from the beginning by securing 
all of the retail clients,'' which would be difficult because most of 
the largest retail clients are already using the Bazaarvoice platform. 
Since its IPO, Bazaarvoice's SEC filings have continued to identify 
``powerful network effects'' from syndication as a ``competitive 
strength[] [that] differentiate[s] [Bazaarvoice] from [] competitors 
and serve[s] as [a] barrier to entry.''
    58. The acquisition of PowerReviews will extend the reach of 
Bazaarvoice's network and deprive its remaining competitors of the 
scale that is necessary to truly compete. Even before the acquisition, 
the company boasted to potential investors, ``[T]he power of 
[Bazaarvoice's] network effect and significant advantage on a global 
scale is starting to crowd out competition.'' As Stephen Collins 
predicted in October 2011, Bazaarvoice's acquisition of PowerReviews 
threatens to ``tip the scales in [Bazaarvoice's] permanent favor on the 
network front.'' During its diligence process for the transaction, 
Bazaarvoice anticipated that the assimilation of major PowerReviews 
retailers into the Bazaarvoice network would ``further increase[] . . . 
switching costs'' and ``deepen[] [its] protective moat.''
    59. Bazaarvoice cannot demonstrate merger-specific efficiencies 
sufficient to counteract the acquisition's anticompetitive effects.

CAUSE OF ACTION

(Violation of Section 7 of the Clayton Act by Bazaarvoice)

    60. The United States realleges and incorporates paragraphs 1 
through 59 as if set forth fully herein.
    61. Bazaarvoice's acquisition of PowerReviews is likely to 
substantially lessen competition in interstate trade and commerce in 
violation of Section 7 of the Clayton Act, 15 U.S.C. Sec.  18.
    62. Among other things, the transaction has had the following 
anticompetitive effects:
    (a) Significant head-to-head competition between Bazaarvoice and 
PowerReviews has been extinguished;
    (b) Bazaarvoice has significantly reduced incentives to discount 
prices, increase the quality of its services, or invest in innovation;
    (c) Prices will likely increase to levels above those that would 
have prevailed absent the transaction, forcing retailers and 
manufacturers to pay higher prices for PRR platforms; and
    (d) Quality and innovation for PRR platforms will likely be less 
than the levels that would have prevailed absent the transaction.

REQUEST FOR RELIEF

    63. The United States requests that:

[[Page 28955]]

    (a) Bazaarvoice's acquisition of PowerReviews be adjudged to 
violate Section 7 of the Clayton Act, 15 U.S.C. Sec.  18;
    (b) the Court order Bazaarvoice to divest assets, whether possessed 
originally by PowerReviews, Bazaarvoice, or both, sufficient to create 
a separate, distinct, and viable competing business that can replace 
PowerReviews' competitive significance in the marketplace;
    (c) the United States be awarded the costs of this action; and
    (d) the United States be awarded any other equitable relief the 
Court deems just and proper.

Dated: January 10, 2013

For Plaintiff United States:

------/s/------
William J. Baer
Assistant Attorney General

------/s/------
Leslie C. Overton
Deputy Assistant Attorney General

------/s/------
Patricia A. Brink
Director of Civil Enforcement

------/s/------
Mark W. Ryan
Director of Litigation

------/s/------
Joseph Matelis
Chief Counsel for Innovation

------/s/------
James J. Tierney, Chief
Networks & Technology Enforcement Section

------/s/------
N. Scott Sacks. Acting Assistant Chief
Networks & Technology Enforcement Section

------/s/------
Michael D. Bonanno (DC Bar No. 998208)
United States Department of Justice
Networks & Technology Enforcement Section
450 Fifth Street, NW., Suite 7100
Washington, DC 20530
Telephone: (202) 532-4791
Fax: (202) 616-8544
Email: michael.bonanno@usdoj.gov

Soyoung Choe (MD Bar, No Numbers Assigned)
Aaron Comenetz (DC Bar No. 479572)
Peter K. Huston (CA Bar No. 150058)
Ihan Kim (NY Bar, No Numbers Assigned)
Claude F. Scott, Jr. (DC Bar No. 414906)
Adam T. Severt (MD Bar, No Number Assigned)

Attorneys for the United States

------/s/------
Melinda L. Haag (CA Bar No. 132612)
United States Attorney
By Alex G. Tse (CA Bar No. 152348)
Office of the United States Attorney
Northern District of California
450 Golden Gate Avenue
San Francisco, CA 94102
Telephone: (415) 436-7200
Facsimile: (415) 436-7234
Email: alex.tse@usdoj.gov

Peter K. Huston (CA Bar No. 150058)
United States Department of Justice, Antitrust Division
450 Golden Gate Avenue
San Francisco, CA 94102
Telephone: (415) 436-6660
Facsimile: (415) 436-6687
Email: peter.huston@usdoj.gov

Michael D. Bonanno (DC Bar No. 998208)
United States Department of Justice, Antitrust Division
450 Fifth Street, NW., Suite 7100
Washington, DC 20530
Telephone: (202) 532-4791
Facsimile: (202) 616-8544
Email: michael.bonanno@usdoj.gov

Attorneys for Plaintiff United States of America

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA 
SAN FRANCISCO DIVISION

UNITED STATES OF AMERICA, Plaintiff,
v.
BAZAARVOICE, INC., Defendant.
Case No. 13-cv-00133 WHO

COMPETITIVE IMPACT STATEMENT

Judge: Hon. William H. Orrick
COMPETITIVE IMPACT STATEMENT
    Pursuant to Section 2(b) of the Antitrust Procedures and Penalties 
Act (``APPA'' or ``Tunney Act''), 15 U.S.C. Sec.  16(b)-(h), Plaintiff 
United States of America files this Competitive Impact Statement 
relating to Plaintiff's Second Amended Proposed Final Judgment, ECF No. 
257, (``Proposed Final Judgment'') submitted on April 24, 2014, for 
entry in this civil antitrust proceeding.
I.
NATURE AND PURPOSE OF THE PROCEEDING
    On June 12, 2012, Defendant Bazaarvoice, Inc. purchased 
PowerReviews, Inc. for approximately $168.2 million. The United States 
filed a civil antitrust Complaint against Bazaarvoice on January 10, 
2013, seeking to unwind the acquisition. The Complaint alleged that the 
likely effect of this acquisition would be to lessen competition 
substantially for ratings and reviews (``R&R'') platforms in the United 
States in violation of Section 7 of the Clayton Act, 15 U.S.C. Sec.  
18. This loss of competition would likely result in higher prices for 
R&R platforms and less innovation.
    This matter was tried before Judge William H. Orrick of the United 
States District Court for the Northern District of California from 
September 23, 2013, through October 10, 2013. The parties called 
numerous fact and expert witnesses via live testimony and video 
depositions, and offered a combined total of 980 exhibits into 
evidence.
    On January 8, 2014, the Court issued a Memorandum Opinion finding 
that Bazaarvoice violated Section 7 of the Clayton Act when it acquired 
PowerReviews, its ``closest and only serious competitor.'' Mem. Op. at 
141. Pursuant to the Court's Order Regarding Remedy Phase, ECF No. 248, 
on February 12, 2014, the United States filed a Motion for Entry of 
Final Judgment setting forth the elements of a remedy for Bazaarvoice's 
unlawful acquisition of PowerReviews, along with a memorandum in 
support thereof. ECF No. 249-3. On March 4, 2014, Bazaarvoice filed its 
Opposition to Plaintiff's Motion for Entry of Final Judgment. ECF No. 
250-3. The United States filed its Reply Memorandum in Support of its 
Motion for Entry of Final Judgment, ECF No. 251-3, along with an 
Amended Proposed Final Judgment, ECF No. 251-5.
    On April 24, 2014, the United States filed a Stipulation and 
Proposed Order along with Plaintiff's Second Amended Proposed Final 
Judgment and an Explanation of Consent Decree Procedures. ECF No. 257. 
These documents are collectively designed to eliminate the 
anticompetitive effects of the acquisition. The Proposed Final 
Judgment, which is explained more fully below, will require Bazaarvoice 
to divest the assets it acquired from PowerReviews and adhere to other 
requirements to replace the competition that was lost in the United 
States R&R platform market when Bazaarvoice acquired PowerReviews.
    Specifically, under the Proposed Final Judgment, Bazaarvoice is 
required to (1) divest all the tangible and intangible assets it 
acquired as part of the PowerReviews acquisition; (2) license the right 
to sell Bazaarvoice's syndication services to the acquirer's customers; 
(3) remove trade secret restrictions on current and former Bazaarvoice 
employees who are hired by the acquirer; (4) license its patents 
related to R&R platforms to the acquirer; and (5) give customers the 
freedom to switch from a Bazaarvoice R&R platform to one provided by 
the acquirer.

[[Page 28956]]

    The United States and Defendant have stipulated that the Proposed 
Final Judgment may be entered after compliance with the APPA. Entry of 
the Proposed Final Judgment would terminate this action, except that 
the Court would retain jurisdiction to construe, modify, or enforce the 
provisions of the Proposed Final Judgment and to punish violations 
thereof.
II.
DESCRIPTION OF THE EVENTS GIVING RISE TO THE VIOLATION
A. The Defendant and the Transaction

    Bazaarvoice provides the market-leading R&R platform to 
manufacturers and online retailers. Pre-merger, the vast majority of 
Bazaarvoice's customers purchased its R&R platform, and subscription 
fees from R&R platforms accounted for the majority of Bazaarvoice's 
revenue. Bazaarvoice is a publicly traded Delaware corporation 
headquartered in Austin, Texas.
    PowerReviews was Bazaarvoice's closest, and only significant 
competitor in the provision of R&R platforms to manufacturers and 
online retailers. Pre-merger, the vast majority of PowerReviews' 
customers purchased its R&R platform, and subscription fees from R&R 
platforms accounted for the vast majority of PowerReviews' revenue. 
PowerReviews was a privately held Delaware corporation headquartered in 
San Francisco, California. During the 2011 calendar year, the company 
earned approximately $11.5 million in revenue. PowerReviews closed the 
best quarter in its history just prior to the acquisition.
    Bazaarvoice acquired PowerReviews on June 12, 2012. The purchase 
price for the transaction, including cash and non-cash consideration, 
was approximately $168.2 million.

B. The Competitive Effects of the Transaction on the Market for R&R 
Platforms in the United States

1. Relevant Markets

    The Court found that the relevant product market is R&R platforms. 
Mem. Op. at 41-42. Most online retailers would be unlikely to eliminate 
R&R entirely because R&R platforms have become a necessary feature for 
online retailers. Id. at 42. Thus, other social commerce products serve 
a different purpose than R&R platforms, and therefore are not 
substitutes for such platforms. Id. at 46. For that reason, other 
social commerce products do not substantially constrain prices of R&R 
platforms. The Court also found that a hypothetical monopolist of R&R 
platforms would find a non-transitory price increase of five or ten 
percent profitable because few customers would abandon R&R platforms in 
response to such a price increase. Id. at 125-26.
    The United States is the relevant geographic market because a 
hypothetical monopolist selling all R&R platforms can identify and 
target price increases to customers operating in the United States, and 
those customers cannot engage in arbitrage--using platforms sold for 
use in other countries. Id. at 51-53. The Court concluded that it was 
appropriate to define the geographic market by customer location. Id. 
at 53. Accord U.S. Dep't of Justice & Fed. Trade Comm'n, Horizontal 
Merger Guidelines Sec.  4.2.2 (2010).

2. Competitive Effects

    The Court found that it is probable that Bazaarvoice's acquisition 
of PowerReviews substantially lessened competition and will result in 
higher prices for R&R platforms in the United States. Id. at 102-118. 
To reach this conclusion, the Court found that the United States 
established a prima facie case that Bazaarvoice's acquisition of 
PowerReviews violated Section 7. Id. at 62-73. Bazaarvoice's 
acquisition of PowerReveiws significantly increased concentration in 
the already highly concentrated R&R platform market. Several different 
measures of market shares within the relevant market confirmed that, 
prior to the merger, Bazaarvoice and PowerReviews were the two leading 
providers of commercial R&R platforms, with a combined market share in 
excess of that required for the government to establish its prima facie 
case.\1\ Id. at 68-69. Specifically, the two market share measures 
principally relied upon by the Court gave Bazaarvoice a post-merger 
market share of 68 and 56 percent, respectively. Id. at 64-65.\2\ To 
further support its market share findings in a case where no ``perfect 
measure'' of market share was available, the Court relied on additional 
market share measures calculated using various other methodologies and 
data sets. Id. at 65-68. These other market share measures were 
generally consistent with the measures principally relied upon by the 
Court and confirmed the robustness of the Court's market share 
findings. Id. at 68. The Court also noted that PowerReviews was 
Bazaarvoice's closest competitor. Id. at 74.
---------------------------------------------------------------------------

    \1\ The Court also concluded that the R&R platform market did 
not contain any rapid entrants who should be assigned market share. 
Id. at 130.
    \2\ Post-merger HHIs associated with these market shares were 
4,590 and 3,915, with merger-related HHI increases of 2,226 and 
1,240, respectively. Id. at 69.
---------------------------------------------------------------------------

    The Court found that the likelihood of anticompetitive effects was 
supported by the weight of the evidence produced at trial. Id. at 103. 
More specifically, the transaction is likely to lead to substantially 
higher prices for customers of Bazaarvoice's R&R platforms. Id. at 102-
103. The evidence the Court relied upon included win-loss data found in 
Bazaarvoice's Salesforce database, data compiled from ``how the deal 
was done'' emails prepared by Bazaarvoice employees in the ordinary 
course of business, and other documentary evidence prepared in the 
ordinary course of business. Id. at 103-06.

3. Entry and Expansion

    The Court found that Bazaarvoice was unable to rebut the United 
States' prima facie case by demonstrating that entry or expansion of 
existing providers would be sufficient to replace the competitive 
constraint previously provided by PowerReviews. Id. at 75-83. The R&R 
platform market has significant entry barriers. Id. at 93. The entry 
barriers identified by the Court include networks effects from 
syndication, switching costs, moderation, analytics, and reputation. 
Id. at 93-102. Syndication of R&R has becoming increasingly important 
to both manufacturers and retailers ``because it allows them to obtain 
more content than they could independently.'' Id. at 12. Bazaarvoice 
recognized that its syndication network differentiated it from its 
competitors and protected its dominant position. Id. at 95. The Court 
found that these barriers to entry would insulate Bazaarvoice from 
competition. Id. at 102.
    None of the fringe competitors have achieved a meaningful level of 
commercial success; they are not likely, therefore, to provide the same 
competitive constraint as PowerReviews before it was acquired by 
Bazaarvoice. Id. at 75-76, 132-33. The Court also found that there was 
no evidence that any large software company was likely to enter the R&R 
platform market. Id. at 87-93.
    The Court found that in-house supply of R&R platforms was not a 
viable alternative to commercial providers of R&R platforms for many 
customers. Id. at 83-86. Several factors, including cost and the need 
for features such as moderation and syndication, discourage customers 
from choosing to build in-house R&R platforms. Id. at 84-85. Indeed, 
for customers who desire syndication, in-house supply of R&R platforms 
is not a viable option. Id. at 85. In-house platforms, therefore, are

[[Page 28957]]

not a significant constraint on Bazaarvoice's pricing.

4. Efficiencies

    The Court found that the transaction did not, and was not likely 
to, result in cognizable, merger-specific efficiencies that will be 
passed through to customers and sufficient to offset the 
anticompetitive effects of the transaction. Id. at 121. Bazaarvoice did 
not claim that the merger reduced the marginal costs of providing its 
services. Id. at 118. In addition, the Court found there was no 
evidence that the merger caused increased innovation. Id. at 121.
III.

EXPLANATION OF THE PROPOSED FINAL JUDGMENT

    The Proposed Final Judgment contains a structural remedy that, 
along with other remedial measures, eliminates the likely 
anticompetitive effects of the acquisition in the R&R platform market 
in the United States. The divestitures and other requirements of the 
Proposed Final Judgment will create an independent and economically 
viable competitor to replace the competition that was eliminated when 
Bazaarvoice acquired PowerReviews. Specifically, the divestiture of the 
PowerReviews assets, the license to certain Bazaarvoice patents, the 
license to sell Bazaarvoice's syndication services, the removal of 
trade secret restrictions on current and former Bazaarvoice employees, 
and the freedom for customers to switch from a Bazaarvoice R&R platform 
to one provided by the acquirer, will provide the acquirer of the 
divestiture assets with the tools needed to compete effectively in the 
R&R platform market in the United States.

A. The Divestiture

    The Proposed Final Judgment requires Bazaarvoice, within ten (10) 
days after entry of the Final Judgment by the Court, to divest (1) all 
of the assets Bazaarvoice acquired when it purchased PowerReviews on 
June 12, 2012; (2) all assets that were acquired, designed, developed, 
or produced for use with the PowerReviews assets; (3) a license to sell 
Bazaarvoice's syndication services to the acquirer's customers, along 
with the technology and know-how to provide such access; (4) a list of 
customers that have either renewed their contracts or become new 
customers of Bazaarvoice since June 12, 2012; and (5) a list of any 
improvements, upgrades or features developed for use with Bazaarvoice's 
R&R platforms since June 12, 2012.\3\
---------------------------------------------------------------------------

    \3\ Unlike the original Proposed Final Judgment and the Amended 
Proposed Final Judgment previously submitted by the United States, 
the Second Amended Proposed Final Judgment does not require 
Bazaarvoice to license a copy of the latest Bazaarvoice R&R platform 
in the event less than 80 percent of legacy PowerReviews customers 
remain on the PowerReviews R&R platform. The potential license of 
the Bazaarvoice R&R platform would only have been triggered if the 
PowerReviews customer base had diminished substantially at the time 
of the divestiture sale. Bazaarvoice's agreement to enter into the 
Proposed Final Judgment requiring the sale of the divestiture assets 
within ten (10) days of entry of the Proposed Final Judgment will 
help ensure that a critical mass of customers will remain on the 
PowerReviews R&R platform at the time it is sold to an acquirer. In 
addition, Paragraphs Nine and Ten of the Joint Stipulation and Order 
prohibit Bazaarvoice from migrating legacy PowerReviews customers to 
a Bazaarvoice platform prior to the sale of the divestiture assets 
and require Bazaarvoice to incentivize customers to remain on the 
PowerReviews R&R platform pending the divestiture.
---------------------------------------------------------------------------

    Bazaarvoice must divest these assets to an acquirer acceptable to 
the United States. The United States retains discretion to accept or 
reject a proposed sale agreement to ensure the acquirer can compete 
effectively in the business of R&R platforms in the United States. The 
assets must be divested and/or licensed in such a way as to satisfy the 
United States, in its sole discretion, that the assets can and will be 
operated by the purchaser as a viable, ongoing business that can 
compete effectively in the business of R&R platforms in the United 
States. Bazaarvoice must take all reasonable steps necessary to 
accomplish the divestiture quickly. In the event that Bazaarvoice does 
not accomplish the divestiture within ten (10) days after entry of the 
Final Judgment, the Final Judgment provides that a trustee will 
complete the divestiture.\4\ The trustee will be selected by the United 
States and appointed by the Court.
---------------------------------------------------------------------------

    \4\ The Proposed Final Judgment gives the United States the 
option to extend the time Bazaarvoice has to divest the assets up to 
sixty (60) days.

---------------------------------------------------------------------------
B. Syndication Services

    The Court found that ``Bazaarvoice's syndication network is a 
barrier to entry in the market for R&R platforms,'' Mem. Op. at 93, and 
that ``[b]esides PowerReviews, no crediblesyndication competitor 
existed.'' Id. at 98. To better enable the divestiture buyer to 
successfully replace the competition that PowerReviews would have 
provided absent the merger, the acquirer must have access to 
Bazaarvoice's syndication network while it works to build its own 
syndication network. Thus, the Proposed Final Judgment requires 
Bazaarvoice to license the right to sell its syndication services to 
the acquirer for four (4) years. Section V.A of the Proposed Final 
Judgment requires Bazaarvoice to provide the acquirer and the 
acquirer's customers with access to Bazaarvoice's syndication network 
on non-discriminatory terms.\5\ To ensure that the acquirer can offer 
these services at a competitive price, the Proposed Final Judgment 
further requires that the fees for providing such services be based 
only on Bazaarvoice's actual costs.\6\
---------------------------------------------------------------------------

    \5\ Section V.B of the Proposed Final Judgment gives the trustee 
appointed under Section VI authority to investigate any complaints 
related to the provision of syndication services.
    \6\ The original Proposed Final Judgment and the Amended 
Proposed Final Judgment previously submitted by the United States 
contemplated an upfront payment by the acquirer for syndication 
services. The Second Amended Proposed Final Judgment provides for a 
cost-based fee for the provision of this service. This change in 
payment terms will not impair the acquirer's ability to provide a 
competitive syndication service.
---------------------------------------------------------------------------

    These provisions ensure that customers will maintain access to 
syndication connections between the two platforms after the sale of the 
divestiture assets. Moreover, these provisions provide clients that 
switch from Bazaarvoice to the acquirer a guarantee that they will not 
lose access to their syndication relationships on the Bazaarvoice 
network. The cross-network syndication provisions in the Proposed Final 
Judgment are of limited duration sufficient to provide the acquirer 
time to build its own customer base and establish an independent 
syndication network without establishing a long-term, on-going 
relationship between Bazaarvoice and the acquirer as such entanglements 
between competitors can be problematic.\7\
---------------------------------------------------------------------------

    \7\ In order to establish a successful syndication network, a 
R&R provider needs a sufficient number of manufacturing and retail 
customers that would be interested in syndicating R&R to each 
other's Web sites.

C. Waiver of Trade Secret Restrictions in Employment Agreements; 
---------------------------------------------------------------------------
Employee Hiring Provisions

    Section IV.C of the Proposed Final Judgment requires Bazaarvoice to 
waive trade secret restrictions related to its R&R technology and 
intellectual property rights for any of its current or former employees 
who are hired by the acquirer. Through its illegal acquisition of 
PowerReviews, Bazaarvoice obtained access to PowerReviews' trade 
secrets, which it could then leverage in its own research and 
development efforts. Conversely, Bazaarvoice has performed minimal 
maintenance on the PowerReviews R&R platform since the acquisition. Id. 
at 119. Waiving trade secret restrictions for employees who are hired 
by the acquirer will ensure that the acquirer, like Bazaarvoice, will

[[Page 28958]]

benefit from the research and development efforts undertaken by the 
combined firm after the merger closed. Moreover, the acquirer will be 
able to hire former Bazaarvoice employees to develop new features 
without fear of being sued by Bazaarvoice for misappropriation of trade 
secrets. These provisions are necessary to provide the acquirer with 
access to the product improvements Bazaarvoice has developed since the 
transaction closed.
    The Proposed Final Judgment also prevents Bazaarvoice from 
interfering with the acquirer's efforts to hire any current or former 
Bazaarvoice employees. This will allow the acquirer to negotiate 
employment agreements with the people who are most knowledgeable about 
the PowerReviews business and any advancements in R&R platform 
technology that have occurred since the merger.

D. License to Bazaarvoice Patents

    Section V.D of the Proposed Final Judgment requires Bazaarvoice and 
the acquirer to enter into a patent licensing arrangement. The license 
shall be provided at no ongoing cost to the acquirer, and it will cover 
all of Bazaarvoice's patents and patent applications related to R&R 
platforms as of the date the divestiture assets are sold. This 
arrangement ensures that Bazaarvoice will not engage in strategic 
behavior to raise its rival's costs through litigation related to 
Bazaarvoice and PowerReviews intellectual property that were commingled 
through the transaction.

E. Transition Services Agreement

    Section IV.G of the Proposed Final Judgment requires Bazaarvoice to 
provide transitional support services to the acquirer for up to one 
year following the divestiture. These provisions are necessary to 
facilitate the seamless transition of the PowerReviews assets from 
Bazaarvoice to the acquirer. The transition services will ensure that 
the acquirer is capable of operating the divested assets, and that 
legacy PowerReviews customers will not experience service disruptions 
as a result of the divestiture. The agreement is limited to one year to 
give Bazaarvoice and the acquirer sufficient time to facilitate the 
transition without creating any unnecessary entanglement between the 
competitors.

F. Customers' Ability to Switch to the Acquirer

    As a result of the merger, new R&R platform customers, and existing 
Bazaarvoice customers whose contracts came up for renewal, were 
deprived of the only significant commercial alternative to Bazaarvoice. 
Since acquiring PowerReviews, Bazaarvoice has expanded its dominant 
position in the sale of R&R platforms. After acquiring the PowerReviews 
assets, the acquirer's market share will place it at a disadvantage 
relative to where PowerReviews would have been today absent the merger. 
To expand its market share, which is critical to its ability to build 
an independent syndication network, the acquirer needs an opportunity 
to effectively solicit Bazaarvoice's customers. As currently 
structured, Bazaarvoice's contracts could deter its clients switching 
to the acquirer mid-contract. Bazaarvoice's typical service contracts 
last for at least a one-year term. Trial Tr. 803:19-804:10. And while 
the company's former CEO testified at trial that customers typically 
have a right to terminate their agreements with thirty days notice, id. 
at 804:1-3, that is not always the case.\8\ To provide the acquirer 
with that opportunity, Section IV.H in the Proposed Final Judgment 
requires Bazaarvoice to waive breach of contract claims against its 
customers if they switch to the acquirer during a limited period of 
time. In addition, Section IV.I in the Proposed Final Judgment will 
prevent conduct by Bazaarvoice that is intended to inhibit expansion by 
the divestiture buyer after it acquires the PowerReviews assets.
---------------------------------------------------------------------------

    \8\ In December 2013, press reports indicated that Bazaarvoice 
sued two of its international customers for breach of contract when 
they switched to a competitor.
---------------------------------------------------------------------------

    To supplement the acquirer's efforts to get Bazaarvoice customers 
to switch to the acquirer's R&R platform and aid in the transition 
period after the sale of the divestiture assets, Section V.C of the 
Proposed Final Judgment prohibits Bazaarvoice from soliciting any 
customers that move to the acquirer's R&R platform for a period of six 
months after the date of sale. This limited non-solicitation period 
during the first six months after the sale will allow the acquirer time 
to develop plans to retain its customers without interference from 
Bazaarvoice.

G. Trustee

    Section VI of the Proposed Final Judgment permits the appointment 
of a trustee by the United States, in its sole discretion. The United 
States intends to recommend a trustee for court approval. The trustee 
will be responsible for monitoring Bazaarvoice's compliance with the 
Final Judgment, and, if necessary, selling the divestiture assets. The 
trustee's monitoring duties include investigating complaints regarding 
Bazaarvoice's provision of syndication services to the acquirer's 
customers and the provision of transition support services. In the 
event Bazaarvoice fails to sell the divestiture assets pursuant to 
Section IV of the Proposed Final Judgment, the trustee will also be 
responsible for selling the divestiture assets.
    The Proposed Final Judgment also provides that Bazaarvoice will pay 
all costs and expenses of the trustee. The trustee will have access to 
all personnel, books, records, and information necessary to monitor 
Bazaarvoice's compliance with the Proposed Final Judgment and, if 
necessary, effectuate the sale of the divestiture assets. After the 
trustee's appointment becomes effective, the trustee will file monthly 
reports with the Court and the United States setting forth his or her 
efforts to accomplish the divestiture and monitor Bazaarvoice's 
compliance with the Final Judgment.

H. Stipulation and Order Provisions

    The parties entered into a Stipulation and Order, filed with the 
Court on April 24, 2014 and entered on April 25, 2014. The Stipulation 
and Order requires Bazaarvoice to abide by the terms of the Proposed 
Final Judgment pending its entry by the Court. To ensure that the 
divestiture assets retain a sufficient customer base to compete 
effectively in the R&R platform market, Paragraph Nine of the 
Stipulation and Order prohibits Bazaarvoice from transferring any 
current users of the PowerReviews R&R platform to a Bazaarvoice R&R 
platform before the divestiture assets are sold. It also prohibits 
Bazaarvoice from reaching any agreements with current PowerReviews R&R 
platform users to transfer them to a Bazaarvoice R&R platform. To 
further that same goal, Paragraph Ten requires Bazaarvoice to implement 
a program designed to encourage current PowerReviews R&R platform 
customers to remain on the platform.

I. Notification Provisions

    Section XI of the Proposed Final Judgment requires Bazaarvoice to 
notify the United States in advance of executing certain transactions 
that would not otherwise be reportable under the Hart-Scott-Rodino 
Antitrust Improvements Act of 1976. The transactions covered by these 
provisions include the acquisition of any assets of, or any interest 
in, a company providing R&R platforms in the United States if the 
purchase price exceeds $10,000,000. This provision ensures that the 
United States will have the ability to take action in advance of 
transactions that could potentially impact competition in the United 
States R&R platform market.

[[Page 28959]]

IV.
REMEDIES AVAILABLE TO POTENTIAL PRIVATE LITIGANTS
    Section 4 of the Clayton Act, 15 U.S.C. Sec.  15, provides that any 
person who has been injured as a result of conduct prohibited by the 
antitrust laws may bring suit in federal court to recover three times 
the damages the person has suffered, as well as costs and reasonable 
attorneys' fees. Entry of the Proposed Final Judgment will neither 
impair nor assist the bringing of any private antitrust damage action. 
Under the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 
Sec.  16(a), the Proposed Final Judgment has no prima facie effect in 
any subsequent private lawsuit that may be brought against Defendant.
V.
PROCEDURES AVAILABLE FOR MODIFICATION OF THE PROPOSED FINAL JUDGMENT
    The United States and Defendant have stipulated that the Proposed 
Final Judgment may be entered by the Court after compliance with the 
provisions of the APPA, provided that the United States has not 
withdrawn its consent. The APPA conditions entry upon the Court's 
determination that the Proposed Final Judgment is in the public 
interest.
    The APPA provides a period of at least sixty (60) days preceding 
the effective date of the Proposed Final Judgment within which any 
person may submit to the United States written comments regarding the 
Proposed Final Judgment. Any person who wishes to comment should do so 
within sixty (60) days of the date of publication of this Competitive 
Impact Statement in the Federal Register, or the last date of 
publication in a newspaper of the summary of this Competitive Impact 
Statement, whichever is later. All comments received during this period 
will be considered by the United States Department of Justice, which 
remains free to withdraw its consent to the Proposed Final Judgment at 
any time prior to the Court's entry of judgment. The comments and the 
response of the United States will be filed with the Court. In 
addition, comments will be posted on the U.S. Department of Justice, 
Antitrust Division's internet Web site and, under certain 
circumstances, published in the Federal Register.
    Written comments should be submitted to:

James Tierney
Chief, Networks and Technology Enforcement Section
Antitrust Division
United States Department of Justice
450 5th Street NW; Suite 7100
Washington, DC 20530

The Proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.
VI.
ALTERNATIVES TO THE PROPOSED FINAL JUDGMENT
    The United States considered pursuing the remedies set forth in the 
Amended Proposed Final Judgment, filed with the Court on March 12, 
2014, through continued litigation. Continued litigation would have 
presented both litigation risk and marketplace uncertainty. Moreover, 
protracted litigation would have magnified the risk of attrition among 
the PowerReviews customer base. The United States is satisfied that the 
requirements and prohibitions contained in the Second Amended Proposed 
Final Judgment provide a prompt, certain, and effective remedy for 
Bazaarvoice's unlawful acquisition of PowerReviews.
VII.
STANDARD OF REVIEW UNDER THE APPA FOR THE PROPOSED FINAL JUDGMENT
    The Clayton Act, as amended by the APPA, requires that proposed 
consent judgments in antitrust cases brought by the United States be 
subject to a sixty-day comment period, after which the court shall 
determine whether entry of the Proposed Final Judgment ``is in the 
public interest.'' 15 U.S.C. Sec.  16(e)(1). In making that 
determination, the court, in accordance with the statute as amended in 
2004, is required to consider:
     (A) the competitive impact of such judgment, including termination 
of alleged violations, provisions for enforcement and modification, 
duration of relief sought, anticipated effects of alternative remedies 
actually considered, whether its terms are ambiguous, and any other 
competitive considerations bearing upon the adequacy of such judgment 
that the court deems necessary to a determination of whether the 
consent judgment is in the public interest; and
     (B) the impact of entry of such judgment upon competition in the 
relevant market or markets, upon the public generally and individuals 
alleging specific injury from the violations set forth in the complaint 
including consideration of the public benefit, if any, to be derived 
from a determination of the issues at trial.

15 U.S.C. Sec.  16(e)(1)(A) & (B). In considering these statutory 
factors, the court's inquiry is necessarily a limited one as the 
government is entitled to ``broad discretion to settle with the 
defendant within the reaches of the public interest.'' United States v. 
Microsoft Corp., 56 F.3d 1448, 1461 (D.C. Cir. 1995); see generally 
United States v. SBC Commc'ns, Inc., 489 F. Supp. 2d 1 (D.D.C. 2007) 
(assessing public interest standard under the Tunney Act); United 
States v. InBev N.V./S.A., 2009-2 Trade Cas. (CCH) ] 76,736, 2009 U.S. 
Dist. LEXIS 84787, No. 08-1965 (JR), at *3, (D.D.C. Aug. 11, 2009) 
(noting that the court's review of a consent judgment is limited and 
only inquires ``into whether the government's determination that the 
proposed remedies will cure the antitrust violations alleged in the 
complaint was reasonable, and whether the mechanism to enforce the 
final judgment are clear and manageable.'').\9\

    \9\ The 2004 amendments substituted ``shall'' for ``may'' in 
directing relevant factors for court to consider and amended the 
list of factors to focus on competitive considerations and to 
address potentially ambiguous judgment terms. Compare 15 U.S.C. 
Sec.  16(e) (2004), with 15 U.S.C. Sec.  16(e)(1) (2006); see also 
SBC Commc'ns, 489 F. Supp. 2d at 11 (concluding that the 2004 
amendments ``effected minimal changes'' to Tunney Act review).
---------------------------------------------------------------------------

    As the United States Court of Appeals for the District of Columbia 
Circuit has held, under the APPA a court considers, among other things, 
the relationship between the remedy secured and the specific 
allegations set forth in the government's complaint, whether the decree 
is sufficiently clear, whether enforcement mechanisms are sufficient, 
and whether the decree may positively harm third parties. See 
Microsoft, 56 F.3d at 1458-62. With respect to the adequacy of the 
relief secured by the decree, a court may not ``engage in an 
unrestricted evaluation of what relief would best serve the public.'' 
United States v. BNS, Inc., 858 F.2d 456, 462 (9th Cir. 1988) (citing 
United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir. 1981)); see 
also Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 
F. Supp. 2d 37, 40 (D.D.C. 2001); InBev, 2009 U.S. Dist. LEXIS 84787, 
at *3. Courts have held that:

[t]he balancing of competing social and political interests affected by 
a proposed antitrust consent decree must be left, in the first 
instance, to the discretion of the Attorney General. The court's role 
in protecting the public interest is one of insuring that the 
government has not breached its duty to the public in consenting to the 
decree. The court is

[[Page 28960]]

required to determine not whether a particular decree is the one that 
will best serve society, but whether the settlement is ``within the 
reaches of the public interest.'' More elaborate requirements might 
undermine the effectiveness of antitrust enforcement by consent decree.

Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted).\10\ In 
determining whether a proposed settlement is in the public interest, a 
district court ``must accord deference to the government's predictions 
about the efficacy of its remedies, and may not require that the 
remedies perfectly match the alleged violations.'' SBC Commc'ns, 489 F. 
Supp. 2d at 17; see also Microsoft, 56 F.3d at 1461 (noting the need 
for courts to be ``deferential to the government's predictions as to 
the effect of the proposed remedies''); United States v. Archer-
Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (noting that 
the court should grant due respect to the United States' prediction as 
to the effect of proposed remedies, its perception of the market 
structure, and its views of the nature of the case).

    \10\ Cf. BNS, 858 F.2d at 464 (holding that the court's 
``ultimate authority under the [APPA] is limited to approving or 
disapproving the consent decree''); United States v. Gillette Co., 
406 F. Supp. 713, 716 (D. Mass. 1975) (noting that, in this way, the 
court is constrained to ``look at the overall picture not 
hypercritically, nor with a microscope, but with an artist's 
reducing glass''). See generally Microsoft, 56 F.3d at 1461 
(discussing whether ``the remedies [obtained in the decree are] so 
inconsonant with the allegations charged as to fall outside of the 
`reaches of the public interest''').
---------------------------------------------------------------------------

    Courts have greater flexibility in approving proposed consent 
decrees than in crafting their own decrees following a finding of 
liability in a litigated matter. ``[A] proposed decree must be approved 
even if it falls short of the remedy the court would impose on its own, 
as long as it falls within the range of acceptability or is `within the 
reaches of public interest.''' United States v. Am. Tel. & Tel. Co., 
552 F. Supp. 131, 151 (D.D.C. 1982) (citations omitted) (quoting United 
States v. Gillette Co., 406 F. Supp. 713, 716 (D. Mass. 1975)), aff'd 
sub nom. Maryland v. United States, 460 U.S. 1001 (1983); United States 
v. National Broadcasting Co., Inc, 449 F.Supp. 1127, 1143 (DCCal. 
1978); see also United States v. Alcan Aluminum Ltd., 605 F. Supp. 619, 
622 (W.D. Ky. 1985) (approving the consent decree even though the court 
would have imposed a greater remedy). To meet this standard, the United 
States ``need only provide a factual basis for concluding that the 
settlements are reasonably adequate remedies for the alleged harms.'' 
SBC Commc'ns, 489 F. Supp. 2d at 17.
    Moreover, the Court's role under the APPA is limited to reviewing 
the remedy in relationship to the violations that the United States has 
alleged in its Complaint, and does not authorize the court to 
``construct [its] own hypothetical case and then evaluate the decree 
against that case.'' Microsoft, 56 F.3d at 1459; see also InBev, 2009 
U.S. Dist. LEXIS 84787, at *20 (``the `public interest' is not to be 
measured by comparing the violations alleged in the complaint against 
those the court believes could have, or even should have, been 
alleged''). Because the ``court's authority to review the decree 
depends entirely on the government's exercising its prosecutorial 
discretion by bringing a case in the first place,'' it follows that 
``the court is only authorized to review the decree itself,'' and not 
to ``effectively redraft the complaint'' to inquire into other matters 
that the United States did not pursue. Microsoft, 56 F.3d at 1459-60. 
As this court confirmed in SBC Communications, courts ``cannot look 
beyond the complaint in making the public interest determination unless 
the complaint is drafted so narrowly as to make a mockery of judicial 
power.'' SBC Commc'ns, 489 F. Supp. 2d at 15.
    In its 2004 amendments, Congress made clear its intent to preserve 
the practical benefits of utilizing consent decrees in antitrust 
enforcement, adding the unambiguous instruction that ``[n]othing in 
this section shall be construed to require the court to conduct an 
evidentiary hearing or to require the court to permit anyone to 
intervene.'' 15 U.S.C. Sec.  16(e)(2). The language wrote into the 
statute what Congress intended when it enacted the Tunney Act in 1974, 
as Senator Tunney explained: ``[t]he court is nowhere compelled to go 
to trial or to engage in extended proceedings which might have the 
effect of vitiating the benefits of prompt and less costly settlement 
through the consent decree process.'' 119 Cong. Rec. 24,598 (1973) 
(statement of Senator Tunney). Rather, the procedure for the public 
interest determination is left to the discretion of the court, with the 
recognition that the court's ``scope of review remains sharply 
proscribed by precedent and the nature of Tunney Act proceedings.'' SBC 
Commc'ns, 489 F. Supp. 2d at 11.\11\
---------------------------------------------------------------------------

    \11\ See United States v. Enova Corp., 107 F. Supp. 2d 10, 17 
(D.D.C. 2000) (noting that the ``Tunney Act expressly allows the 
court to make its public interest determination on the basis of the 
competitive impact statement and response to comments alone''); 
United States v. Mid-Am. Dairymen, Inc., 1977-1 Trade Cas. (CCH) ] 
61,508, at 71,980 (W.D. Mo. 1977) (``Absent a showing of corrupt 
failure of the government to discharge its duty, the Court, in 
making its public interest finding, should . . . carefully consider 
the explanations of the government in the competitive impact 
statement and its responses to comments in order to determine 
whether those explanations are reasonable under the 
circumstances.''); S. Rep. No. 93-298, 93d Cong., 1st Sess., at 6 
(1973) (``Where the public interest can be meaningfully evaluated 
simply on the basis of briefs and oral arguments, that is the 
approach that should be utilized.'').
---------------------------------------------------------------------------

VIII. DETERMINATIVE DOCUMENTS
    There are no determinative materials or documents within the 
meaning of the APPA that were considered by the United States in 
formulating the Proposed Final Judgment.

Dated: May 8, 2014

Respectfully submitted,

FOR PLAINTIFF
UNITED STATES OF AMERICA

/s/Michael D. Bonanno
Michael D. Bonanno
United States Department of Justice
Antitrust Division
450 Fifth Street, NW., Suite 7100
Washington, DC 20530
Telephone: (202) 532-4791
Facsimile: (202) 616-8544
E-mail: michael.bonanno@usdoj.gov
Attorneys for Plaintiff United States of America

Peter K. Huston (CA Bar No. 150058)
United States Department of Justice, Antitrust Division
450 Golden Gate Avenue
San Francisco, CA 94102
Telephone: (415) 436-6660
Facsimile: (415) 436-6687
E-mail: peter.huston@usdoj.gov

Michael D. Bonanno (DC Bar No. 998208)
United States Department of Justice, Antitrust Division
450 Fifth Street, NW., Suite 7100
Washington, DC 20530
Telephone: (202) 532-4791
Facsimile: (202) 616-8544
E-mail: michael.bonanno@usdoj.gov

Attorneys for Plaintiff United States of America

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA 
SAN FRANCISCO DIVISION

UNITED STATES OF AMERICA, Plaintiff,
v.
BAZAARVOICE, INC. Defendant.
Case No. 13-cv-00133 WHO

PLAINTIFF'S SECOND AMENDED [PROPOSED] FINAL JUDGMENT

Judge: Hon. William H. Orrick
Hearing Date: April 25, 2014
Time: 9 a.m.

[[Page 28961]]

PLAINTIFF'S SECOND AMENDED [PROPOSED] FINAL JUDGMENT

    Plaintiff United States of America filed its Complaint on January 
10, 2013; Defendant Bazaarvoice, Inc., filed its Answer on February 22, 
2013, denying the substantive allegations in the Complaint; this Court 
having conducted a full trial on all issues of liability and issued its 
findings of fact and conclusions of law on January 8, 2014, holding 
that the acquisition of PowerReviews by Bazaarovice violated Section 7 
of the Clayton Act, 15 U.S.C. Sec.  18; and
    The United States and Defendant, by their respective attorneys, 
have consented to the entry of this Final Judgment; and
    Defendant agrees to be bound by the provisions of this Final 
Judgment pending its approval by the Court; and
    The essence of this Final Judgment is the prompt and certain 
divestiture of certain assets and rights by Defendant to fully restore 
the competition eliminated by Bazaarvoice's unlawful acquisition;
    It is hereby ORDERED, ADJUDGED AND DECREED:

I. Jurisdiction

    This Court has personal jurisdiction over Bazaarvoice and subject 
matter jurisdiction under Section 15 of the Clayton Act, 15 U.S.C. 
Sec.  25.

II. Definitions

    As used in this Final Judgment:
    A. ``Acquirer'' means the entity to whom Defendant divests the 
Divestiture Assets.
    B. ``Bazaarvoice'' or ``Defendant'' means Bazaarvoice, Inc., a 
Delaware corporation with its headquarters in Austin, Texas, its 
successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, partnerships and joint ventures, and their directors, 
officers, managers, agents, and employees.
    C. ``Divestiture Assets'' means
     1. All tangible and intangible assets that were acquired by 
Bazaarvoice when it purchased the PowerReviews business on June 12, 
2012, including:
     i. All tangible assets that comprise the PowerReviews business, 
including research and development activities; all personal property, 
inventory, materials, supplies, office furniture, computer systems, and 
other tangible property and all assets used in connection with the 
PowerReviews business; all licenses, permits and authorizations issued 
by any governmental organization relating to the PowerReviews business; 
all contracts, teaming arrangements, agreements, leases, commitments, 
certifications, and understandings, relating to the PowerReviews 
business, including supply agreements; all customer lists, contracts, 
accounts, and credit records; and all repair and performance records 
and all other records relating to the PowerReviews business; and
     ii. All intangible assets used in the development, production, 
servicing and sale of the PowerReviews assets, including, but not 
limited to, all patents, licenses and sublicenses, intellectual 
property, copyrights, trademarks, trade names, service marks, service 
names, technical information, computer software and related 
documentation, know-how, trade secrets, drawings, blueprints, designs, 
design protocols, specifications for materials, specifications for 
parts and devices, safety procedures for the handling of materials and 
substances, all research data concerning historic and current research 
and development relating to the PowerReviews assets, quality assurance 
and control procedures, design tools and simulation capability, all 
manuals and technical information Defendant provides to its own 
employees, customers, suppliers, agents or licensees, and all research 
data concerning historic and current research and development efforts 
relating to the PowerReviews assets, including, but not limited to, 
designs of experiments, and the results of successful and unsuccessful 
designs and experiments.
     2. All tangible and intangible assets, as described above, that 
were acquired, developed, designed, or produced for use with the 
PowerReviews assets described in II.C.1 since June 12, 2012.
     3. A license, for four (4) years, to sell Bazaarvoice's 
Syndication Services product or service offering to customers of 
Acquirer as described in Section V.A.
     4. All technology (whether software, hardware, or both), know-how 
(including trade secrets), and other intellectual property rights 
necessary for Acquirer to provide access to Bazaarvoice's Syndication 
Services to its customers.
     5. A list of all of Defendant's customers that either (1) renewed 
a contract for the provision of a PRR Platform with Defendant since 
June 12, 2012, or (2) became a new customer of Defendant for a PRR 
Platform since June 12, 2012. Such list shall include the name of each 
such customer and the date on which the customer's contract expires 
and/or is up for renewal.
     6. A list of each feature, improvement, upgrade or any other 
technology related to PRR Platforms that Defendant developed since June 
12, 2012 for use with Bazaarvoice's PRR Platform(s).
    D. ``PowerReviews'' means (1) PowerReviews, Inc., the company that 
was acquired by Bazaarvoice on June 12, 2012, and (2) all the assets 
formerly of PowerReviews, Inc.
    E. ``PowerReviews Enterprise Platform'' means all PowerReviews PRR 
Platform products except for PowerReviews Express (also referred to as 
Bazaarvoice Express) products and the Buzzillions web product.
    F. ``PRR Platform'' means the front-end and back-end technologies, 
including features such as moderation, syndication, and analytics, that 
enables the collection, organization, storage, use and display of user-
generated product ratings and reviews and related content on a Web 
site.
    G. ``Transition Services Agreement'' means an agreement between 
Defendant and Acquirer for Defendant to provide all necessary 
transition services and support to enable Acquirer to fully operate the 
Divestiture Assets and compete effectively in the market for providing 
PRR Platforms in the United States as of the date the Divestiture 
Assets are sold.
    H. ``Syndication Services'' means the products and services 
currently provided by Bazaarvoice, and any successor thereto, that 
provide the ability to share product ratings and reviews and related 
content between two or more customers.

III. Applicability

    A. This Final Judgment applies to Bazaarvoice as defined above, and 
all other persons in active concert or participation with it who 
receive actual notice of this Final Judgment by personal service or 
otherwise.
    B. If, prior to complying with Section IV and VI of this Final 
Judgment, Defendant sells or otherwise disposes of all or substantially 
all of their assets or of lesser business units that include the 
Divestiture Assets, Defendant shall require the purchaser to be bound 
by the provisions of this Final Judgment. Defendant need not obtain 
such an agreement from the Acquirer of the assets divested pursuant to 
this Final Judgment.

IV. Divestiture

    A. Defendant is ordered and directed to divest the Divestiture 
Assets within ten (10) days of the entry of the Final Judgment in this 
matter in a manner consistent with this Final Judgment to an Acquirer 
acceptable to the United States, in its sole discretion. The United 
States, in its sole discretion, may agree to one or more extensions of 
this time

[[Page 28962]]

period not to exceed sixty (60) calendar days in total, and shall 
notify the Court in such circumstances. Defendant agrees to use its 
best efforts to divest the Divestiture Assets as expeditiously as 
possible.
    B. Defendant shall inform any person making inquiry regarding a 
possible purchase of the Divestiture Assets that they are being 
divested pursuant to this Final Judgment and provide that person with a 
copy of this Final Judgment. Defendant shall offer to furnish to all 
prospective Acquirers, subject to customary confidentiality assurances, 
all information and documents relating to the Divestiture Assets 
customarily provided in a due diligence process except such information 
or documents subject to the attorney-client privilege or work-product 
doctrine. Defendant shall make available such information to the United 
States and the Trustee at the same time that such information is made 
available to any other person.
    C. Defendant shall provide Acquirer and the United States with 
information relating to the personnel involved in the production, 
operation, development and sale of the Divestiture Assets, and all 
Bazaarvoice PRR Platforms, to enable Acquirer to make offers of 
employment. Defendant will not interfere with any negotiations by 
Acquirer to employ any of Defendant's current or former employees. 
Interference with respect to this paragraph includes, but is not 
limited to, enforcement of non-compete clauses with regard to the 
Acquirer, and offers to increase salary or other benefits apart from 
those offered company-wide. In the event any current or former 
employee(s) of Defendant accepts an offer of employment with Acquirer 
within six (6) months of the date of the sale of the Divestiture 
Assets, Defendant will not seek to enforce any restrictions against or 
otherwise prohibit such employee(s) from using or disclosing to the 
Acquirer any of Defendant's trade secrets, know-how or proprietary 
information related to PowerReviews' or Defendant's PRR Platform 
technology in connection with the employee(s)'s employment with 
Acquirer, nor will Defendant seek to impede or prohibit Acquirer's use 
of such trade secrets, know-how or proprietary information. Nothing in 
this paragraph shall prevent Defendant from taking any appropriate 
legal action against any of Defendant's current or former employees who 
(1) accept an offer of employment with Acquirer and (2) remove tangible 
documents (whether in hard-copy or electronic form) or items from 
Bazaarvoice that contain trade secrets, know-how or proprietary 
information.
    D. Defendant shall permit prospective Acquirers of the Divestiture 
Assets to have reasonable access to personnel and to make inspections 
of the physical facilities; and access to any and all financial, 
operational, or other documents and information customarily provided as 
part of a due diligence process.
    E. Defendant shall warrant to Acquirer that each asset will be 
operational on the date of sale.
    F. Defendant shall not take any action that will impede in any way 
the permitting, operation, or divestiture of the Divestiture Assets.
    G. At the election of Acquirer, Defendant and Acquirer shall enter 
into a Transition Services Agreement for a period up to one (1) year 
from the date of the divestiture. The Transition Services Agreement 
shall enumerate all the duties and services that Acquirer requires of 
Defendant. Defendant shall perform all duties and provide any and all 
services required of Defendant under the Transition Services Agreement. 
Any amendments, modifications or extensions of the Transition Services 
Agreement may only be entered into with the approval of the Court.
    H. After the sale of the Divestiture Assets until (1) the 
expiration of the current PRR Platform contract or (2) one year from 
the date of the letter described in Section IV.I, whichever is later, 
for any PRR Platform customer of Defendant that wishes to become a PRR 
Platform customer of Acquirer, Defendant shall waive any potential 
breach of contract claim related to the transfer of that customer from 
Defendant to Acquirer, notwithstanding any other agreement to the 
contrary.
    I. Within three (3) calendar days of the date of the sale of the 
Divestiture Assets, Defendant shall send a letter to all persons who 
were customers of Defendant as of the date of the sale of the 
Divestiture Assets notifying the recipients of the divestiture and 
providing a copy of this Final Judgment. The letter shall also 
specifically inform customers of Defendant's obligations under Section 
IV.H of this Final Judgment. Acquirer shall have the option to include 
its own letter with Defendant's letter. Defendant shall provide the 
United States, and the Trustee, a copy of its letter at least three (3) 
calendar days before it is sent.
    J. Unless the United States otherwise consents in writing, the 
divestiture pursuant to Section IV, or by Trustee appointed pursuant to 
Section VI, of this Final Judgment, shall include the entire 
Divestiture Assets, and shall be accomplished in such a way as to 
satisfy the United States, in its sole discretion, that the Divestiture 
Assets can and will be used by Acquirer as part of a viable, ongoing 
business of providing PRR Platforms in the United States. The 
divestiture, whether pursuant to Section IV or Section VI of this Final 
Judgment,
     1. shall be made to an Acquirer that, in the United States' sole 
discretion, has the intent and capability (including the necessary 
managerial, operational, technical and financial capability) of 
competing effectively in the business of PRR Platforms; and
     2. shall be accomplished so as to satisfy the United States, in 
its sole discretion, that none of the terms of any agreement between 
Acquirer and Defendant gives Defendant the ability unreasonably to 
raise Acquirer's costs, to lower Acquirer's efficiency, or otherwise to 
interfere in the ability of Acquirer to compete effectively.

V. Other Required Conduct

    A. Defendant shall provide to Acquirer and Acquirer's customers 
access to Defendant's syndication network for four (4) years following 
the date of sale of the Divestiture Assets by:
     1. Providing Syndication Services according to the financial terms 
described in the fee schedule set forth in the definitive divestiture 
agreement. The pricing contained in the fee schedule shall reflect only 
Defendant's actual costs in providing the service with no additional 
fees or charges in connection with the provision of this service. The 
Acquirer may elect to pay Defendant directly or to have Defendant bill 
Acquirer's customers for Syndication Services; and
     2. Providing Syndication Services on non-discriminatory terms with 
respect to Defendant's and Acquirer's customers. For the avoidance of 
doubt, the following is a non-exhaustive list of terms for which 
Defendant may not discriminate:
     i. Speed of content transmission;
     ii. server lag time and/or uptime;
     iii. alignment of product databases;
     iv. database synchronization;
     v. content presentation;
     vi. pricing to Defendant's customers based on syndication 
partner(s);
     vii. data fields transmitted or utilized; and
     viii. integration with Question and Answer products.
    Nothing in this paragraph shall be interpreted to permit Acquirer's 
customers receiving Syndication Services from Defendant to violate any 
terms of service that are applicable to all of Defendant's customers 
receiving Syndication Services.

[[Page 28963]]

    B. Defendant shall promptly notify the Trustee and the United 
States of all complaints, whether written or oral, it receives relating 
to Section V.A of this Final Judgment. The Trustee may conduct an 
investigation of any complaint and shall submit all findings from any 
such investigation to the United States and Defendant.
    C. Defendant shall refrain from soliciting the customers acquired 
by Acquirer as part of the Divestiture Assets for six (6) months 
following the date of sale of the Divestiture Assets.
    D. Defendant shall provide to Acquirer, at no cost to Acquirer, an 
irrevocable, fully paid-up perpetual and non-exclusive license to all 
Bazaarvoice patents and patent applications related to PRR Platforms 
issued or filed at the time the Divestiture Assets are sold to 
Acquirer. Defendant shall not sue any PRR Platform customer of Acquirer 
for infringement of any patent or patent application issued or filed at 
the time the Divestiture Assets are sold relating to such customer's 
use of any PRR Platform or other Divestiture Asset provided by 
Acquirer.
    E. Defendant is prohibited from retaining a copy of or offering for 
sale any of the Divestiture Assets described in Section II.C.1 and 2.

VI. Appointment of Trustee

    A. Upon application of the United States, the Court shall appoint a 
Trustee selected by the United States and approved by the Court to 
monitor Defendant's compliance with the obligations set forth in this 
Final Judgment, and, if necessary, effect the sale of the Divestiture 
Assets.
    B. If Defendant has not sold the Divestiture Assets during the 
period set forth in Section IV.A, only the Trustee shall have the right 
to sell the Divestiture Assets. The Trustee shall have the power and 
authority to accomplish the divestiture to an Acquirer acceptable to 
the United States at such price and on such terms as are then 
obtainable upon reasonable effort by the Trustee, subject to the 
provisions of Sections IV, V, VI, and VII of this Final Judgment, and 
shall have such other powers as this Court deems appropriate. Subject 
to Section VI.D of this Final Judgment, the Trustee may hire at the 
cost and expense of Defendant any investment bankers, attorneys, or 
other agents, who shall be solely accountable to the Trustee, 
reasonably necessary in the Trustee's judgment to assist in the 
divestiture and performance of the other duties required of the Trustee 
by this Final Judgment. The Trustee shall provide notice to the United 
States and Defendant of all persons hired by the Trustee, and the terms 
of such persons' compensation, within one (1) day of hiring.
    C. Defendant shall not object to a sale by the Trustee on any 
ground other than the Trustee's malfeasance. Any such objections by 
Defendant must be conveyed in writing to the United States and the 
Trustee within ten (10) calendar days after the Trustee has provided 
the notice required under Section VII.
    D. The Trustee shall serve at the cost and expense of Defendant, on 
such terms and conditions as the United States approves, and shall 
account for all monies derived from the sale of the assets sold by the 
Trustee and all costs and expenses so incurred. After approval by the 
Court of the Trustee's accounting, including any remaining fees for its 
services and those of any professionals and agents retained by the 
Trustee, all remaining money shall be paid to Defendant. The 
compensation of the Trustee and any professionals and agents retained 
by the Trustee shall be on reasonable and customary terms. With respect 
to work performed pertaining to the divestiture, incentives based on 
the price and terms of the divestiture and the speed with which it is 
accomplished may be provided. If the Trustee and Defendant are unable 
to reach agreement on the Trustee's or any agents' or consultants' 
compensation or other terms and conditions of engagement within 
fourteen (14) calendar days of appointment of the Trustee, the United 
States may, in its sole discretion, take appropriate action, including 
making a recommendation to the Court.
    E. Defendant shall use its best efforts to assist the Trustee in 
accomplishing the required divestiture and performing the other duties 
required of the Trustee by this Final Judgment. The Trustee and any 
consultants, accountants, attorneys, and other persons retained by the 
Trustee shall have full and complete access to the personnel, books, 
records, and facilities of Defendant, and Defendant shall develop 
financial and other information from Defendant as the Trustee may 
reasonably request, subject to reasonable protection for trade secret 
or other confidential research, development, or commercial information. 
Defendant shall take no action to interfere with or to impede the 
Trustee's accomplishment of the divestiture or any other duties 
outlined in this Final Judgment.
    F. After appointment, the Trustee shall file monthly reports with 
the United States, Defendant, and the Court setting forth the Trustee's 
efforts to accomplish the divestiture ordered under this Final 
Judgment, and Defendant's compliance with the other terms of this Final 
Judgment. To the extent such reports contain confidential or highly 
confidential information under the Protective Order, such reports shall 
not be filed in the public docket of the Court. Such reports shall 
include the name, address, and telephone number of each person who, 
during the preceding month, made an offer to acquire, expressed an 
interest in acquiring, entered into negotiations to acquire, or was 
contacted or made an inquiry about acquiring, any interest in the 
Divestiture Assets, and shall describe in detail each contact with any 
such person. The Trustee shall maintain full records of all efforts 
made to divest the Divestiture Assets.
    G. If the Trustee has not accomplished the divestiture ordered 
under this Final Judgment within six (6) months after appointment, the 
Trustee shall promptly file with the Court a report setting forth (1) 
the Trustee's efforts to accomplish the required divestiture, (2) the 
reasons, in the Trustee's judgment, why the required divestiture has 
not been accomplished, and (3) the Trustee's recommendations. To the 
extent such reports contain confidential or highly confidential 
information under the Protective Order, such reports shall not be filed 
in the public docket of the Court. The Trustee shall at the same time 
furnish such report to the United States which shall have the right to 
make additional recommendations consistent with the purpose of the 
Final Judgment. The Court thereafter shall enter such orders as it 
deems appropriate to carry out the purpose of the Final Judgment.
    H. The Trustee shall serve until four (4) years following the date 
of sale of the Divestiture Assets.
    I. If the United States determines that the Trustee has ceased to 
act or failed to act diligently or in a reasonably cost-effective 
manner, it may recommend the Court appoint a substitute Trustee.

VII. Notice and Court Approval of Proposed Divestiture

    A. Within one (1) calendar day following execution of a definitive 
divestiture agreement, Defendant or the Trustee, whichever is then 
responsible for effecting the divestiture required herein, shall notify 
the United States and the Court of any proposed divestiture required by 
Section IV or VI of this Final Judgment. If the Trustee is responsible, 
the Trustee shall similarly notify Defendant; if Defendant is 
responsible, it shall similarly notify the Trustee. The notice shall 
set forth the details of the proposed divestiture and list the name, 
address, and telephone

[[Page 28964]]

number of each person not previously identified who offered or 
expressed an interest in or desire to acquire any ownership interest in 
the Divestiture Assets, together with full details of the same.
    B. Within three (3) calendar days of receipt by the United States 
of such notice, the United States may request from Defendant, the 
proposed Acquirer, any other third party, or the Trustee, if 
applicable, additional information concerning the proposed divestiture, 
the proposed Acquirer, and any other potential Acquirer. Defendant and 
the Trustee shall furnish any additional information requested within 
five (5) calendar days of the receipt of the request, unless the 
parties shall otherwise agree.
    C. Within twenty-one (21) calendar days after receipt of the notice 
or within fifteen (15) calendar days after the United States has been 
provided the additional information requested from Defendant, the 
proposed Acquirer, any third party, and the Trustee, whichever is 
later, the United States shall provide written notice to Defendant and 
the Trustee stating whether or not it objects to the proposed 
divestiture. If the United States provides written notice that it does 
not object, the divestiture may be consummated, subject only to 
Defendant's limited right to object to the sale under Section VI.C of 
this Final Judgment. Absent written notice that the United States does 
not object to the proposed Acquirer or upon objection by the United 
States, a divestiture proposed under Section IV or Section VI shall not 
be consummated. Upon objection by Defendant under Section VI.C, a 
divestiture proposed under Section VI shall not be consummated unless 
approved by the Court.

VIII. Financing

    Defendant shall not finance all or any part of any purchase made 
pursuant to Section IV or VI of this Final Judgment.

IX. Affidavits

    A. Within twenty (20) calendar days of the entry of this Final 
Judgment, and every thirty (30) calendar days thereafter until the 
divestiture has been completed under Section IV or VI, Defendant shall 
deliver to the United States an affidavit as to the fact and manner of 
its compliance with Section IV or VI of this Final Judgment. Each such 
affidavit shall include the name, address, and telephone number of each 
person who, during the preceding thirty (30) calendar days, made an 
offer to acquire, expressed an interest in acquiring, entered into 
negotiations to acquire, or was contacted or made an inquiry about 
acquiring, any interest in the Divestiture Assets, and shall describe 
in detail each contact with any such person during that period. Each 
such affidavit shall also include a description of the efforts 
Defendant has taken to solicit buyers for the Divestiture Assets, and 
to provide required information to prospective Acquirers, including the 
limitations, if any, on such information.
    B. Within twenty (20) calendar days of the date of the sale of the 
Divestiture Assets, Defendant shall deliver to the United States an 
affidavit that describes in reasonable detail all actions Defendant has 
taken and all steps Defendant has implemented on an ongoing basis to 
comply with Section V of this Final Judgment. Defendant shall deliver 
to the United States an affidavit describing any changes to the efforts 
and actions outlined in Defendant's earlier affidavits filed pursuant 
to this section within fifteen (15) calendar days after the change is 
implemented.
    C. Defendant shall keep all records of all efforts made to preserve 
and divest the Divestiture Assets until one year after such divestiture 
has been completed.

X. Compliance Inspection

    A. For the purposes of determining or securing compliance with this 
Final Judgment, or of any related order, or of determining whether the 
Final Judgment should be modified or vacated, and subject to any 
legally recognized privilege, from time to time authorized 
representatives of the United States Department of Justice, including 
consultants and other persons retained by the United States, shall, 
upon written request of an authorized representative of the Assistant 
Attorney General in charge of the Antitrust Division, and on reasonable 
notice to Defendant, be permitted:
     1. Access during Defendant's office hours to inspect and copy, or 
at the option of the United States, to require Defendant to provide 
hard copy or electronic copies of, all books, ledgers, accounts, 
records, data, and documents in the possession, custody, or control of 
Defendant, relating to any matters contained in this Final Judgment; 
and
     2. To interview, either informally or on the record, Defendant's 
officers, employees, or agents, who may have their individual counsel 
present, regarding such matters. The interviews shall be subject to the 
reasonable convenience of the interviewee and without restraint or 
interference by Defendant.
    B. Upon the written request of an authorized representative of the 
Assistant Attorney General in charge of the Antitrust Division, 
Defendant shall submit written reports or respond to written 
interrogatories, under oath if requested, relating to any of the 
matters contained in this Final Judgment as may be requested.
    C. If at the time information or documents are furnished by 
Defendant to the United States, Defendant represents and identifies in 
writing the material in any such information or documents to which a 
claim of protection may be asserted under the Protective Order, then 
the United States shall give Defendant ten (10) calendar days notice 
prior to divulging such material in any legal proceeding (other than a 
grand jury proceeding).

XI. Notification

    A. Unless such transaction is otherwise subject to the reporting 
and waiting period requirements of the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976, as amended, 15 U.S.C. Sec.  18a (the ``HSR 
Act''), Defendant, without providing advance notification to the 
Antitrust Division, shall not directly or indirectly acquire any assets 
of or any interest, including any financial, security, loan, equity or 
management interest, in a person providing PRR Platforms in the United 
States during the term of this Final Judgment if the purchase price of 
such assets or interest exceeds $10,000,000.
    B. Such notification shall be provided to the Antitrust Division in 
the same format as, and per the instructions relating to the 
Notification and Report Form set forth in the Appendix to Part 803 of 
Title 16 of the Code of Federal Regulations as amended, except that the 
information requested in Items 5 through 9 of the instructions must be 
provided only about PRR Platforms. Notification shall be provided at 
least thirty (30) calendar days prior to acquiring any such interest, 
and shall include, beyond what may be required by the applicable 
instructions, the names of the principal representatives of the parties 
to the agreement who negotiated the agreement, and any management or 
strategic plans discussing the proposed transaction. If within the 30-
day period after notification, representatives of the Antitrust 
Division make a written request for additional information, Defendant 
shall not consummate the proposed transaction or agreement until thirty 
(30) calendar days after submitting all such additional information. 
Early termination of the waiting periods in this paragraph may be 
requested and, where appropriate, granted in the same manner as is 
applicable under the requirements and

[[Page 28965]]

provisions of the HSR Act and rules promulgated thereunder. This 
Section shall be broadly construed and any ambiguity or uncertainty 
regarding the filing of notice under this Section shall be resolved in 
favor of filing notice.

XII. No Reacquisition

    Defendant may not reacquire any part of the Divestiture Assets 
during the term of this Final Judgment.

XIII. Retention of Jurisdiction

    This Court retains jurisdiction to enable any party to this Final 
Judgment to apply to this Court at any time for further orders and 
directions as may be necessary or appropriate to carry out or construe 
this Final Judgment, to modify any of its provisions, to enforce 
compliance, and to punish violations of its provisions.

XIV. Expiration of Final Judgment

    Unless this Court grants an extension, this Final Judgment shall 
expire ten years from the date of its entry.

XV. Public Interest Determination

    Entry of this Final Judgment is in the public interest. The parties 
have complied with the requirements of the Antitrust Procedures and 
Penalties Act, 15 U.S.C. Sec.  16, including making copies available to 
the public of this Final Judgment, the Competitive Impact Statement, 
and any comments thereon and the United States' responses to comments. 
Based upon the record before the Court, which includes the Competitive 
Impact Statement and any comments and response to comments filed with 
the Court, entry of this Final Judgment is in the public interest.

IT IS SO ORDERED.

Dated:-----------------------------------------------------------------

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HON. WILLIAM H. ORRICK
United States District Judge

[FR Doc. 2014-11577 Filed 5-19-14; 8:45 am]
BILLING CODE P